Hello and welcome to our Q2 2025 Market Update. We hope your summer is off to a great start. This quarter gave investors a lot to talk about—with big moves in both directions and a powerful recovery that closed the period on a high note.
What Made Q2 2025 Stand Out?
Q2 2025 was a quarter of extremes. It gave us both the lowest and highest market levels of the year—all within the same three-month window.
Markets opened the quarter with sharp losses. In early April, a wave of unexpected tariffs hit global trade, sending stocks into a tailspin. Investor concerns over inflation, slowing growth, and geopolitical tensions pushed markets to their lowest point of the year.
At the market low on April 8th, the S&P 500 was down nearly 19% from its February record high. But the story didn’t end there.
By mid-April, the U.S. paused additional tariffs, earnings season kicked off with strong results, and AI-related optimism returned to center stage. From there, markets rebounded sharply. By the end of June, the S&P 500 had climbed over 11% for the quarter and not only recovered its earlier losses—but also set a new all-time high.
Q2 2025 Market Highlights
· S&P 500: +11.3%
· Nasdaq 100: Strong double-digit gains, led by AI and big tech
· Gold: Gained early in the quarter during the risk-off period
· Small- and mid-caps: Participated in the rally but trailed large-cap tech
· Bonds: Stabilized as expectations for Fed rate cuts returned
Notably, much of the market’s strength came from a few mega-cap technology stocks—particularly those tied to artificial intelligence. Companies like Nvidia, Palantir, and Meta posted strong earnings and drew significant investor attention.
Looking Ahead to Q3 and Beyond
As we enter the second half of 2025, we’re watching several trends closely:
· Market concentration risk: The top 10 stocks in the S&P 500 now account for over 35% of the index’s weight.
· Potential Fed policy changes: Rate cuts could support further gains—but may also signal caution about economic growth.
· Policy impacts: Ongoing discussions around trade and fiscal policy could affect both inflation and business investment.
Our Message: Stay the Course
Despite early volatility, Q2 ended with strong gains for patient investors. If there’s one key takeaway this quarter, it’s that timing the market is nearly impossible. Reacting to short-term news often leads to missed opportunities, as we saw with April’s swift selloff followed by a sharp rebound.
Thank You
Wishing you a relaxing and rewarding summer. We’ll see you next quarter for our new market update.
